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Facebook's Data Gathering Hit by German Antitrust Authorities

Germany’s antitrust watchdog ordered a crackdown on Facebook’s data collection practices after ruling the social network abused its market dominance to gather information about users without their knowledge or consent.

Germany’s Federal Cartel Office gave the company 12 months to stop “unrestrictedly collecting and using” such data and combining it with users’ Facebook accounts without their voluntary consent.

The cartel office objected in particular to how Facebook acquires data on people from third-party apps and its online tracking of people who aren’t even members. That includes tracking visitors to websites with an embedded Facebook ‘like’ or share button - and pages where it observes people even though there is no obvious sign the social network is present.

Facebook said it would appeal the ruling, adding the watchdog underestimated the competition it faced and undermined Europe-wide privacy rules that took effect last year.

Thursday’s order is the result of a three-year probe into how Facebook scoops up data of its customers and whether it leverages its market power to make users agree to give up their information. No fine was issued.

"The Bundeskartellamt underestimates the fierce competition we face in Germany, misinterprets our compliance with GDPR and undermines the mechanisms European law provides for ensuring consistent data protection standards across the EU," Facebook said.

"The Bundeskartellamt found in its own survey that over 40% of social media users in Germany don’t even use Facebook. We face fierce competition in Germany, yet the Bundeskartellamt finds it irrelevant that our apps compete directly with YouTube, Snapchat, Twitter and others," Facebook added.

The company also promised to soon introduce Clear History, a tool where users will be able to see the information Facebook receives from the websites and services who use its business tools and disassociate it from users's accounts.

Facebook admitted that it tailors each person’s Facebook experience and that uses a variety of information to do this – including the information included on users' profiles, news stories users like or share and what other services users use.

Facebook has about 30 million users in Germany, where it has hired hundreds of people to remove fake news, illegal postings such as Holocaust denials, and fake accounts from the site.

The German regulator said it can levy fines of as much as 10 million euros if the company fails to follow the order.

The German probe is one of many the Menlo Park, California-based company is facing in Europe and the U.S. over handling personal data. The case goes to the core of how Facebook increases its advertising revenue. The regulator is targeting the network’s habit of collecting data about what websites users are visiting and merging the information with their Facebook profiles. That trove of information allows ads to be tailored to individual users.

Facebook also faces fierce scrutiny of over a series of privacy lapses, including the leak of data on tens of millions of Facebook users, as well as the extensive use of targeted ads by foreign powers seeking to influence elections in the United States.